Food supplier admits to cheating US military

The admission by a multinational food company that it defrauded the US military, by drastically increasing the cost of basic items shipped into a war zone, has sparked concerns that Australia may also have been a victim.

The Sydney Morning Herald has reported that Supreme Foodservice and related entities held multimillion-dollar contracts to supply Australia and other International Security Assistance Force nations in Afghanistan from the mid-2000s until 2013.

The long-running fraud, which involved price hikes for food, water and other goods purchased from Supreme, resulted in Supreme and related entities having to pay US authorities $US96 million ($135 million) in fines, $US48 million in restitution and $US10 million in criminal forfeiture.

The operation was conducted using a ‘middleman’ company established in the United Arab Emirates. Jamal Ahli Foods Co was used to mark up prices for fresh fruit and vegetables and other locally produced foods sold to the US.

The scheme, which the FBI says ran from 2005 to 2009, was also used to obscure the inflated price that Supreme was charging the US for water.

The FBI says Supreme’s clients were not aware that Supreme controlled Jamal Ahli Foods Co while it was acting as a so-called independent company lifting the prices of goods purchased in Dubai.